In the second part of a series on how technology can help us reimagine a better Malaysia, the focus turns to re-energising the workforce and reshaping a new, digital economy.

Talk about technological disruption and the humble gas station may seem like an archaic relic waiting for the next revolution. Yet, its ubiquity is in fact a product of a disruption that revolutionised auto manufacturing forever.

History shows us that the Ford Model T did not just see the setting-up of assembly lines, but also paved the road to greater personal mobility that jump-started 20th-century economic growth.

Now, the world is on the brink of another era-defining disruption, thanks to accelerating advances in artificial intelligence (AI) and other technologies that will reshape economies and society worldwide.

The emerging question then is whether Malaysia will move fast enough to ride the wave and reap the benefits for its people before disruption catches us off-guard.

Here’s a taste: AI investments are set to boost revenues and job creation across all industries by 38% and 10% respectively between 2018 and 2022, growing incomes in some sectors such as consumer goods and health by as much as 50%, according to a 2017 Accenture survey.

And the adrenaline rush is expected to bump global profits by a whopping US$4.8 trillion by 2022. The caveat, though, is that these boosts assume that companies invest at the same rate as top-performing businesses.

Therein lies the question. Are our businesses willing to take the plunge and invest in new technologies? The answer is somewhat muddled.

Employees, at least, are eager to augment their productivity with AI and upskill to keep up with the rapid changes, though self-confidence could be improved further. Two-thirds of the 2017 survey respondents believe it will be important to learn how to work with AI in the next three to five years; 45% believe AI will boost their efficiency; but only 34% are confident they possess the skills to work with AI.

As for employers, there is less urgency. While over half agree that the human-machine tag team is crucial to achieving their strategic priorities, a meagre 3% are planning to invest significantly more in training and reskilling over the next three to five years.

The mismatch in turn presents a major challenge in building momentum to participate in the next big economic disruption, with the risk that businesses, left to their own devices, will be left behind.

Already, we are seeing the fallout and danger signals as an unprepared and insufficiently skilled workforce comes head-to-head with technologically disrupted sectors.

A study released by the Khazanah Research Institute last October estimates that as much as 54% of current jobs in Malaysia will be displaced or significantly changed by automation. Four out of five are middle-skill jobs and 90% are held by Malaysian workers.

The clock is clearly ticking to begin reshaping the economy and the workforce driving it into an AI-ready combination that can keep pace with the next big disruption.

Rethinking education

That is where the public sector can play its role in reskilling and upskilling Malaysian workers so that they are ready for the unfolding AI integration across economic activities.

At the heart of this role is that the education sector, particularly universities and schools, must pivot towards teaching content in smarter ways. Reskilling should also encompass workers who are at risk of being rendered obsolete as AI takes over their jobs.

In the short term, the cost of investing in an AI-centric education and training approach will be high — as is the case for businesses —  as economies of scale will take time to develop. But the benefits must be seen over a longer perspective as the established foundations can be replicated at relatively low cost and improved over time.

And AI technology itself can help the transformation by automating some teaching processes and curating smart content services to enhance the knowledge transfer process.

 Cram101, for example, uses AI to break down course content into digestible study guides, practice tests and speed up revisions with advanced learning tools. Such products also enable a shift from passive to active learning.

Using AI and new technology in the education sector is akin to killing two birds with one stone. Not only can learning about the technology better prepare Malaysian graduates for higher-skilled jobs, AI-powered education can also reduce the cost and duration of producing graduates while enabling direct engagement with the technology itself.

Wider economic pivot

It is also important to remember that the potential of AI disruption should not be the exclusive domain of such industries in the “sharing economy” or “platform economy”, like Grab, iflix and Kaodim.

The bigger revolutions may eventually take place in the “old economy” — yet still-vital industries such as agriculture, where AI could remove middlemen requirements and reduce cost layers, boost productivity and automate processes for greater efficiency and productivity.

In turn, an AI-reshaped economy and employment landscape, done properly, will see many layers of benefits emerge for the common man on the street. For example, upskilling to fit an AI-augmented role will increase productivity and subsequently, income levels, which lead to greater purchasing power and better quality of life.

In terms of services, sharing-economy platforms that offer pay-per-use access to cars and even working spaces will displace much of the current ownership-based access model that lumps high costs upfront to the consumer.

Even farmers and food producers stand to gain as efficiency gains, coupled with lower production costs, will enable them to improve their earnings without inflating prices to keep up with rising costs of living. Greater food productivity also contributes towards better national food security.

Given the muddled preparedness in the private sector, however, the emerging signal is that the public sector should take the lead in nudging the economy towards the next great disruption.

The government, for example, could leverage on AI to read economic signals and data on a deeper level, enabling better understanding of the economic and employment issues affecting citizens and workers.

Such an application from the public sector will create that initial momentum towards an AI-driven economic ecosystem. It would be easier for the private sector to move towards an already growing ecosystem than to start their own.

The bonus point here is that by leading the way, the government can also shape that ecosystem into a strong and robust economic space based on its vision of how an AI-augmented economy should look like.

That is a critical point because creating a strong ecosystem is vital for  businesses to thrive. Three-quarters of those surveyed by Accenture’s Technology Vision 2017 survey agree that the strength of their partners and ecosystems is as important as their own in determining the competitive edge of their businesses.

Clearly it is critical to begin now in developing a fully AI-augmented Malaysian workforce that can power the economy forward in keeping pace with the next great disruption. Only then can Malaysia, and Malaysians, reap the rewards of a new economic reality.